Odd Lots - Lots More With Skanda Amarnath on This Moment in Macro

Episode Date: August 15, 2025

Right now, you could make a good argument that inflation is still too hot, and that with the stock market booming, and the unemployment rate at 4.2%, that it's crazy to think about cutting rates. You could also argue that much of the economy is stalling, that the pace of job growth has slowed dramatically, and that with housing in the tank, we need lower rates. Then on top of this situation, layer in the fact that we have this weird bifurcated economy, with the AI sector growing like gangbusters. And then add onto that the attacks on the independence of the Federal Reserve coming from the Trump administration. And furthermore, trade policy is still a moving target. To make sense of this complicated time — and to look ahead to next week's Jackson Hole conference — we speak with Skanda Amarnath, the executive director of Employ America. Only Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox — now delivered every weekday — plus unlimited access to the site and app. Subscribe at bloomberg.com/subscriptions/oddlotsSee omnystudio.com/listener for privacy information.

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Podcasts, Radio News. So here's why I'm so confused right now. Like if someone said to me... Just one reason. If someone said to me, look, you know, the economy is slowing down. Clearly job creation is in the tank. It's decelerating. Housing is in the tank, et cetera.

There's a bunch of sectors that are soft when you need rate cuts. Okay, that sounds good. Inflation has come down quite a bit from where it was. but it's still elevated. And then if someone said, look, the stock market's record highs, PPI just came in super hot, inflation is still above levels, et cetera. Are you insane to even be talking about rate cuts? I'd be like, oh, yeah, okay, that makes sense too. Like, I find many kinds of arguments to be very persuasive right here. I don't have a strong views. I'm not one for hyperbole. I try not to be, right? I try to be a good journalist in that sense. But I would honestly

say, like, this is one of the most difficult macro environments to call in probably my professional career, which is longer than I would necessarily like it to be at this point. But as you said, if you look at the stock market, which feeds into financial conditions, right? Look at financial conditions. Like financial conditions do not look that restrictive at the moment. And yet you do have people who say that actually we are still in restrictive territory and the labor market is weakening, as you said. And so we need a rate cut. So we have this one body of people who are talking about a potential Fed policy error. And then we have another body of people, including people from the Trump administration who are talking about the need to do a 50 basis point cut in September.

You could make the argument that the Fed is either committing a policy error now or contemplating a policy area. Then there's this whole dynamic with the fact that we know that there's this one incredible thing going on, which is all the AI spending and how that actually intersect with macro is very confusing. So we have Jackson Hole next week, which we're going to be at. I'm excited about Jackson Hole. So the scuttle butt for journalists going to Jackson Hole is that apparently like the rooms are even higher demand than normal because behind all the macro debate, which we just laid out, there's also the question of Fed Independence, right? So interest in Jackson Hole is like higher than it's ever been. It's going to be a big Jackson Hall.

Whatever the formal theme of the conference is going to be, you know, there's going to be some academic theme coming up. Whatever that is, that's not going to be the theme. The theme is going to be all of the talk about Fed Independence. I did a dead list. I'm both the most popular trader and most successful trader at Citadel. Fed is going viral. Barges. This is an after-school special except...

I've decided I'm going to base my entire personality going forward on campaigning for a strategic pork reserve in the U.S. Black gold! These are the important questions. Is it robots taking over the world? No, I think that, like, in a couple of years, the AI will do a really good job of making the oddlots podcast. One day, that person will have the mandate of heaven. How do I get more popular and successful? We do have the perfect guest.

You're listening to Lots More, where we catch up with friends about what's going on right now. Because even when the Odd Lots is over, there's always lots more. And we really do have the perfect guest. Skonda, nice to have you here in our news studio. When Joe's confused, you're the guy we turn to. Yeah, that's right. Let's start. Actually, just quick take.

We're recorded this 904, August 14th about 30 minutes ago. We got that really hot PPI reports. but also I don't know what that means. Like, is it a big deal? What does it say? What's going on there? What does it mean for PCE? Is it, it should mean is that margins are going to be crimped?

What's going on there? I mean, I think for PPI today should be seen as at least showing the inflationary side of the story is still there. Okay. Not just in terms of like some of the aggregates may be distorted for a lot of reasons, but what matters for the Fed's inflation gauged got moved up a bit. Okay. So what you're going to be tracking for inflation for July, CPI and PPI, BPI, both matter. And so that's going to be moved up a bit. So we're going to be running at roughly

2.9% on core PCE. That's what is actually substantially. We are higher now than we were last year. It's starting to look like the progress is starting to turn the other direction. Now, there may be some reasons why it is transitory this time, that it is temporary. And yet, it doesn't really feel great. And I imagine for Chair Powell, there's a feeling of, wait, I remember in 2021 and August, I was pretty confident that this was, to be short term. And then we saw some increases. And I said, well, we got to focus on the labor market back first. And then people kind of have held that against him accordingly. But now we have inflation picking up. And yeah, we also see a job market. Maybe employment levels

look fine. Yeah. The momentum, the job growth that we're seeing in the latest release is understandably spooky too. I asked Mary Daly this question before. But do starting points matter here because if you look at the labor market, the labor market has been really, really strong in recent years, like certainly much stronger than people had expected. And so, okay, there are some signs of softening now. It does seem to be losing momentum, but we are still starting from a place of strength. Does that mean potentially the Fed can, you know, maybe let that one go and look more at the inflation risk, to your point? I think it certainly matters. It's not the only thing that matter. I think momentum and starting point both matter. And the starting point is better. The momentum is

some of the weakest we've seen outside of a recession in a while. Now, some of that might be due to immigration, some of that might be due to tariff uncertainty, some of that might be due to interest rates are higher. And that matters for some sectors more, even if the financial conditions you just talked about are still pretty accommodative if you're talking about capital markets. So these are all kind of confusing in terms of what is the actual labor market trajectory that's permissible. I think the Fed is right now inclined to cut in September, given what we've seen in the labor market data. But I will just warn, just as the data got revised before, it could get revised again. It may be the case that May and June were the weakest months for job growth and that we see some local acceleration,

just because there's a little bit more certainty on trade policy than there was before. Right. So there's still another jobs report before the September meeting. And there's another batch of inflation data that's also going to come out. And I think that will actually probably matter in the sense that typically you see price changes that are more volatile as you get into back to school season, holiday season, the turn of the calendar year. What we've seen thus far is typically the more benign months when you typically don't see prices change that much. So there's still a lot to play for in terms of going into the September meeting. So here's the thing I've been thinking about trying to conceptualize what's going on.

And, you know, as Tracy mentioned, we talked to Mary Daly last week in Alaska. And she's kind of of of the view right now or she says that she does not think that the tariffs will be particularly inflationary or inflationary on a sustained basis. And, you know, there's certainly an argument. Tariffs are tax increases and tax increases we don't think of as inflationary. We think of them as disinflationary, if anything. On the other hand, they throw a wrench into supply chains. They have very different effects across different. They sort of strike me as like a bit of just like throwing sand into gears.

And if you combine throwing sand into gears with really big deficits. And now that I'm middle age, I talk about deficits. We got a pretty big July deficit number. It was 10% higher than the year before. This is despite the tariff revenue. If you're throwing sand into gears of industry, making commerce less efficient by creating all these frictions, and you're pushing in all this money by expanding deficits, that strikes me as a potentially inflationary cocktail. I would agree. I think that's possibly we have both, right, that there is

what I would call stagflation light, right? Obviously, unemployment rates are still low. That's pretty distinct from the stagflation of the 70s. But the momentum in the labor market seems weaker, because I think there probably is for any sort of trade sensitive sector. Think about construction, manufacturing, retail trade, wholesale trade, warehousing. These are all showing weakness in job growth more recently. And so we're seeing that side of the equation. That should be disinflation area at the margin because less labor income should mean less consumer spending. And at the same time, you're putting in costs, adding to the business cost structure in ways that businesses can't stomach beyond a certain point, right? So some businesses are probably

well positioned to absorb the hit to margin, but there's a limit to that as well. I think the issue with sort of the tariff slash trade shock, the modeling of it is if you have costs be pushed through to consumers over time, that can still be consistent with just real income. sort of declining, even if nominal income growth is on steadyer footing. And so that would be a very tricky backdrop for the fact to navigate. Just going back to inflation for a second, can you walk us through what's going on with energy prices at the moment? Because on the one hand, oil still pretty low, as we talked a lot about in Alaska. They don't love that in Alaska. Yeah, people really care about the price of oil in Alaska, not necessarily the way that most car driving

Americans do. It's funny. It's like, if we're in America, America, an oil crisis, in the quote, lower 48, which is a term I'd never use as much than in the last week. It's like an oil crisis is when it's really high. There's the exact opposite. That's right. That's right. Okay, so oil prices are low, but at the same time, we're seeing some electricity prices rise, possibly a sort of crowding out effect from all the data center demand and AI enthusiasm and things like that. Yeah, so I think that there's a bifurcation and energy prices, right?

So we have your standard commodity prices, specifically for oil, have stayed at the lower end of the range, right? We're still, speaking, in the maybe the low 60s, right, in WTI. So these are prices that should be not painful for the consumer. And yet we also have electricity price increases. And the electricity price increases that we've seen, some part of that is due to natural gas price volatility, although natural gas prices more recently have come down. But there's also an in, there are a lot of things that go into electricity prices that are independent of that. And so in a lot of regions of the country, we're seeing capacity looks to be short. For the longest time, a lot of these, a lot of what you call sort of thermal sources

of electricity generation are typically not very economical, right? Or an economical in a short-run sense, because we have more capacity than we need. So the ability to be paid for that capacity is not great. So that's why we retire coal plants. We retire nuclear plants. Now you're seeing the other side of that, right? And it takes a long time to build that stuff. And so the retirements are coming to a pause for, hey, actually we might be short on capacity if the data center demands are there. And building new capacity is very expensive, very time intensive. And that seems to be an issue in at least a number of major regions. So there's like the Mid-Atlantic region, PJM.

You're hearing this also show up, though, in terms of rates are increasing in Georgia. And New England has its own set of problems because it burns a lot of natural gas for electricity, but also doesn't have, like, the requisite pipeline capacity. I love that I'm double hedge to New England energy prices plus con ed in New York. Although I do have solar panels in Connecticut now, as we were discussing. So sometimes my bill is actually negative, which is lovely. The Texas hedge. This is the thing, which is that, so I mentioned in the beginning, so much investment happening in AI, which doesn't seem to like, I mean, doesn't seem to be paying off economy while yet. It's not like we've seen some great disinflationary boom or all these companies suddenly getting more efficient.

Though maybe there are, I'm sure you can find pockets, but there's a lot of spending. And there's a lot of spending on gear and there's a lot of spending on buildings and a little bit of spending on labor. You know, some people have been talking about this crowding out effect. Jason Furman talked about it in a tweet that maybe this feels like a fiscal crowding out. Is that fair at this point or is it too soon to tell like whether all this expenditure? Wisconsin has been writing about this quite a bit as well. Yeah, I'm curious how do you characterize it right now. I mean, obviously there's some bid for resources that could otherwise be deployed elsewhere and also be.

bit sort of if, let's say you're an investor and you're obviously some level of capital constraint going on. If you're investing everything in AI and basically cutting spending and investment in other areas, there's some sort of crowding out effect. But I would just also caution that's like a secondary effect, right? The primary one is still that there's more investment. But on the electricity front, though, is that connected or is that still just are many factors pushing up electricity across and maybe data centers are one of? I think the data center effect is something probably better to describe up until this very moment, like, we're probably hitting something of an inflection point, right? So you are, like, low demand for

electricity has stopped sort of having sort of its local stagnation. Okay, yeah, yeah, yeah. But we haven't yet seen the pickup. The pickup is probably coming very soon, or maybe right now. And as that happens, and it has its pass through into pricing over the coming years, I think there will be a sort of super cycle dynamic to this, that is likely to weigh on costs and investment. Sorry, just to be clear, like, those like price increases in Georgia that people are talking about. Or it's too early to say, oh, that's data centers. It's a sort of yes and no question where economists give you both answers because it's like, if something stops going down and starts flattening out and starts to pick up.

There is a, like, it may not have started going up in outright terms, but the dynamic is, it's part of the dynamic. So I think that I think it's both. Eating well shouldn't be complicated. But somehow it turns into recipes, prep, clean up, and half your Sunday gone. Factors solves all that. These are fresh, ready-to-eat meals designed by dieticians, delivered to your door, and ready in just minutes. No prep, no cleanup, no excuses.

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So please join me, listen and subscribe to the Michelle Hussein show from Bloomberg Weekend, wherever you get your podcast. You certainly ask interesting questions. As we mentioned, Joe and I are going to Jackson Hole next week. And the theme doesn't really matter. The theme is central bank independence and if Powell is going to do what President Trump is asking him to do, which is cut rates. I'm thinking how to characterize this question.

How does like the central bank dynamic actually feed into the discussion around rates? I mean, I think the there is on one level the federal will tell you they're putting the blinders on. and they don't listen to what Scott Besson does most actively lobbying for was 50 basis points. And yet, you can't deny that there is going to be some issue of how does the Fed do something in a way where it doesn't look politically manipulated? The legitimacy in some ways of whatever the Fed does gets undermined. There's an optics problem now. If they don't do what the Treasury says, then they're clearly trying to push back against the Treasury in some way. And so then there will be one set of stakeholders who are upset.

And at the same time, there are others who will be saying, like, if the Fed does cut 50 basis points, it's like, okay, they're just following the Treasury. We should just listen to Scott Besson now. And that is a dilemma for how you really handle the optics. I'm Mary Daley talked about this on your episode, which was just, you got to try to explain your decisions, try to be transparent, try to be consistent. Those are really important things. It will matter to a point. And yet I'm sure there'll be plenty of cynics. Fed needs to start tweeting in all caps. Tracy, did you see the headline yesterday? I think it was attributing CNBC that David Zervos is on Trump's story. No, you guys laugh. I like David. We have never had them on oddlots, which is an oversight. I've always liked talking to David, though. But I feel like, you know, we never got, unfortunately, Paul McCulley, the Fed,

the long-haired, iconoclassic guy from industry. Oh, yeah. And David Zervos is like the next best shot of this sort of. of iconic classic guy who comes from Wall Street. I like David. I like David. I feel like, you know, he's like the closest thing to like a contemporary, kind of a McCulleyish character. I will say from a sartorial perspective, it would be very interesting.

Yeah, I like, I've always loved Tony to David. I mean, he would certainly be a character. He would be great character. And so you probably get livelier press conferences. You make great press coverage. Do you have any thoughts on the derby? Every day the list of names gets longer. Do you have any thoughts on this process?

I can't take it seriously, right? I think as far as the number of names that have been thrown, I don't think Janet Yellen is being considered actively. So these are things that seem very... That one elicited. I saw the headline, too. And, yeah, there are some names that they're that... So, I mean, there are some names to take seriously.

I'm not saying it, but I do think the length of the list being offered, some of them are clearly not. Serious names being put forth, but it may serve some tactical purpose for the kind of policies they want, if they're trying to broaden the list of people who they're considering, get those people to lobby more actively and publicly for lower rates, then that might be something to serve in White House fair.

Nick Timrose at the journal pointed this out in an article, which is that if you have 100 people who all think that they're in the running to be fed share, that's 100 people going on TV saying, now's a great time to cut rates. And then you're sort of like, wait, why isn't Powell cutting rates? Everyone on TV knows now's the time. So there's some deep brilliance going on here. I do have asked, though, like all the lobbying. for lower rates. We have a substantial number of rate cuts priced in over the next 12 months,

and yet long-term interest rates haven't really budge that much. Yeah. Which is, if you think about where the pain points in the frustration are with like higher interest rates right now, or at least for, to the extent you think 4.3% Fed funds rate is high, and that's part of the reason why 10-year yields are at 4.2, 4.3%, roughly speaking. Like, you're not getting much effect from the rate rate cuts being priced right now. And I do think I kind of raise some questions about what is the actual objective here. Even if you get the rate cuts you so desperately wish, especially if it's coming at a time of- It doesn't feed into like the 30-year mortgage rate. Yeah, exactly. Housing was the big pain point and you're not really getting that effect. That to me suggests like there is some level

of a credibility gap here. If you're just saying I'm going to cut rates no matter what, no matter what the inflation rate is because I want to do it for political motivation. I mean, I want investors obviously need to be compensated on some level for risk, or also for the risk that maybe some in the future, rates might go back up. If the people who are arguing for lower rates today would argue for higher rates under a different political environment, that's not exactly, that doesn't lend itself to getting long-term interest rates lower. And what's your take on why long-term interest rates haven't gone lower? I think there's probably two things here that stick out to me. One is, well, inflation still seems like it's there, right? We haven't gotten things back to 2%. And so there's

just a risk of the Fed being caught off sides here if the Fed starts to cut more aggressively at a time when inflation might pick up. You can say, well, this time inflation is transitory. But it's like, we're dealing with potentially big macro adjustments. They might be costly. And if nominal incomes, labor income growth is reasonably solid, the cost might get pushed through, right? So the consumer, because the consumer can pay. And that's a dynamic that markets have to be sensitive to. So there's a level of, well, you're actually adding more inflation risk. And that needs to be compensated for. There's also, I think, a level of political manipulation risk, right?

If you actually did lower rates for reasons that aren't really grounded in data, I mean, Kevin Orch said, I don't care about data defendants. If you're not doing things for, like, relatively neutral reasons and you're doing things for political convenience, one, the political convenience can cut the other way at another point in time. Let's say there are people who are doing things for partisan reasons today, and maybe it's a different person in the White House in the future. And then there's also just the issue of, well, there's just more instability.

I want more compensation for that risk. And I do think, like we're seeing, if you look at the slope between five-year-notes and 10-year-notes, normally high, even considering that rate cuts have been priced in. I know that Joe is a term premium skeptic, and I, to some extent, I am too, but I do think that there's more suggestive evidence now

that you are seeing more demands for compensation for risk. And that, again, kind of speaks to undermining independence. If you think this process of setting interest rates is not really being guided by something relative, negatively neutral politically, something that's more focused on the data. But it's really just about pleasing certain presidential preferences and whims on a short-term basis. As a long-term investor, I might want more compensation for that. There's some merit to that argument at least. Don't worry. At Jackson Hole, Joe and I are going to sit around a campfire and meditate on the

meaning of the term premium. Yeah, that's right. We're going to get it figured out next time. Eating well shouldn't be complicated, but somehow it turns into recipes, prep, cleanup, and half your Sunday gone. Factor solves all that. These are fresh, ready-to-eat meals designed by dieticians, delivered to your door, and ready in just minutes. No prep, no cleanup, no excuses. And it's not just about convenience. You're getting real food, balanced nutrition, and zero artificial stuff. Meals that help you stay on track for all of your goals without the grind of doing it all yourself. Grilled chicken, roasted veggies, steak plates, postables. They taste like something you get in a restaurant, but they come out of your microwave in two minutes flat.

If time, cost, or effort have been holding you back from eating better, Factor just took those off the table. Right now, get 11 meals, free shipping, and free sides for life. Hurry, this offer won't last long. Go to FactorMeals.ca and use code fit. That's 11 meals, free shipping and free sides for life, but only with the code fit at factoramills.ca. Factor, Canada's number one ready-to-eat meal delivery service.

Don't these clowns in Washington, D.C. need to stop their addiction to borrowing money. I'm entering my AM radio. This is back to your middle age. Yeah, I want to be a yakker on AM radio. Don't these clouds of D.C. Need to stop spending. But deficits are very large.

Like, you know, setting aside politics, they're very big, especially given the low level of unemployment rate, 4.2%. Like, we're spending a lot of money. And that's a lot of money being pushed into the economy. much of it going to low productivity areas because of the growth, like, health care, et cetera. Don't we need to have some good old fashion fiscal consolidation with inflation

still at these elevated levels? There's certainly an argument for if you wanted to try and get demand down, then you could possibly do that, right? So if you think demand is a problem, right? Then you probably wouldn't be so worried about the labor market, right? So that's one part of it.

I also say, like, folks that have been saying the tariffs are a big revenue raiser, right? One part of it is, we're still seeing like either the fact is, like, It just doesn't matter in the context of the deficit. Yeah. In which case it's not a big revenue raiser. That's one argument you can make.

If you think it's actually still a lot of money being raised, and yet we're still seeing 10-year yield dynamics as they are, maybe it's something else. I mean, I think the problem always is the stories about deficits and how they drive interest rates tend to always be, there's like a missing link there, or at least there's not a lot of robust correlation here between the scale of the deficit and what interest rates end up looking like.

And I do think, like, institutional descriptions of what's going on, kind of have a little more merit. Like we are doing some things at the central bank and in ways that can undermine investor confidence. I think that strikes me as more compelling. But at the margin, if you wanted to address the deficit for whatever reason, yeah, there's probably a lot of room to do that when we've just did a pretty big sort of

consolidation of corporate tax cuts. And at the same time, like, there's obviously an aging population that does have more demands for major social insurance programs. Cranky Joe. Yeah, I've become a cramp. It's just like, we need to, I'm not going, I don't give policy advice. By the way, Tracy, we're telling us, Gondra Amrana, the executive director of employment. Oh, yeah, we should say that.

20 minutes in. Probably should say that. Okay. So we're going to Jackson Hole. One of the nice things about Jackson Hole is that you can run into people, you know, just if you're hiking outside of the lodge, the hotel over there. If we were to run into Jerome Powell, what's the one question we should ask? Well, the one question I selfishly am interested in is what are they going to do with the

framework here, right? So the framework review that was much fanfare about it in 2019 and 2020. This is the whole fate thing. This was the fate thing. This was when they cited flexible average inflation targeting. That high employment wasn't inherently a bad thing or inherently an inflationary thing. They made some tweaks to their framework. There are people who blamed those tweaks for the reason why the Fed allowed all this inflation to happen. I think they kind of messed around some counterfactuals, but they are doing the same exercise now, but just much more low profile. And maybe that makes sense because this is sort of a time of leadership flux where there is going to be someone else who's fed chair in a year. And maybe that person will want to

have more of a say and doesn't want to be stomped on. But they have said they want to do some of these changes to their framework and then do a review of their communications. And especially at a moment when you have these conflicting forces where there are things that are pushing up inflation. and at the same time there are signs that labor markets are slowing. It just feels like what the Fed's going to communicate is going to be confusing. I want a good example of this from your episode with Mary Daily was basically saying, well, we have goods inflation. That might be tariffs.

But like services, X housing looks to be like not inflationary. And the Fed basically said the same story in 2021. And then it spread. And it's spread because for some people will say, well, it's because the labor market is too strong. They kind of miss that goods prices matter to service prices. So think about insurance. Think about the cost of goods matters there. If you think about leasing, rental, airfares are affected by energy prices, food services prices,

are affected by food prices. And so the Fed could easily be caught off sides again. And I think that's something that I worry about, independent of whoever is the leader, whether it's Chris Waller, whether it's Kevin Warsh, whether it's Kevin Asset. David. David Zervos. This is something that I think is really unappreciated. You know, we've seen car insurers saying that they're going to raise rates.

because the cost of parts is expected to go up under tariffs. And there are all these sort of hidden connections in the economy, as we learned on our trip to Alaska once again, where you could see tariff inflation start to show up. So one example is, you know, you think you're buying Alaskan salmon made in Alaska, caught in Alaska. But it turns out a bunch of that salmon gets sent to China for processing. And so it gets re-imported into the U.S. And so even something like Alaskan salmon, you would see a tariff impact. I know. We should do, we didn't do a fish episode, but I, that was really, I didn't, had not realized how much American fish is processed in China that re-imported. It's really the miracle

of shipping. I have one last, one last question. Things are like so catac, stocks are doing fine. He's like, oh, it's doom and all this stuff and political politics and the deficit and interest rate and et cetera. Like, stocks are like super forward looking. Is it 100%? Yeah, but that's because it's all this like tech money and AI spending, it doesn't totally satisfy me. There's other parts that finance and doing. Like, what's going on there? That does not seem like a market that is worried about all these things that we talk about. Yeah, it does seem like there's more growth optimism in cap markets. And I think tech is part of the story right now. The SMP500 kind of adjust for reclassification is about half tech, right? So it's clearly growing in terms of

its relevance. And at the same time, all this tech spending is probably keeping the business cycle afloat on some level, at least more so than it would otherwise be the case. But if you look at stuff like even in equal-weighted S&P, or you look at other sort of measures that may be more neutral to the tech dynamic, they've also shown a decent amount of optimism, right? So those are also telling you there's a lot of confidence. That confidence might be misplaced, but at least at the short run, like there's some wisdom in it. And that to me is like a reason to probably shade against taking the bleakest view right now. And I think even if you look at the jobs report that everyone I think rightfully said has a lot of weakness in it.

Look at total hours growth among rank and file employees. If you look at total income growth among those workers, it's pretty fine. That was actually okay. And so we might have gotten the worst jobs report already. If we don't, then obviously the Fed can probably have more confidence cutting. But if it's actually the case that like, there's actually was a, we had a liberation day shock about it,

what didn't break things, especially because things got reversed to a large degree, then you might be left to the situation where it's just slowing growth in real terms and maybe the nominal trajectory of the economy that total dollar spend, total dollars earned, aren't as adversely affected. And that might not be a world in which you expect both high rate cuts or anything that's sort of deeply recessionary, at least in the short run. Tracy, you know, I did run into Jerome Powell, you know, in Jackson Hall, just like serendipitously.

Oh, I forgot about that. Yeah, I know. It was like, you hadn't come yet, and it was just in the lodge, and you was sitting there with a couple of people. I think he was talking to. Did you say hi? Yeah, and I froze. Like I did, I froze because I couldn't really think it didn't seem like the right time to actually like talk shop.

In retrospect, I should have like said something about the dead and like, you know, it told because I had seen Dead & Co that year. And I should, that would have been a good thing. But I said, oh, it's really beautiful here. I had never been. Like I sounded really stupid. I yelled at one of his secret service people without knowing it was one of his secret service people. He was like, he was stuffing a bag into the airplane in a really violent way that was crushing my own bag.

that had something kind of breakable in it. And so I was like, excuse me, stop doing that. And then he got really angry. Yeah, well. Lots more is produced by Carmen Rodriguez and Dashel Bennett with help from Moses Ondom and Kail Brooks. Our sound engineer is Blake Maples. Sage Bowman is the head of Bloomberg podcasts.

Please rate, review, and subscribe to Odd Lots and Lots More on your favorite podcast platforms. And remember that Bloomberg subscribers can listen to all our podcasts ad-free by connecting through Apple Podcasts. Thanks for listening. Joe, you do a worryingly good impression of a crank.